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Why the NHL Decided to Open Up More Sponsorship Inventory on the Ice

The league spent 3+ years discussing and planning before deciding to go forward with the initiative.

Adam White

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TAMPA, FL – JANUARY 28: Brent Burns #88 of the San Jose Sharks skates to the net with the puck during the 2018 Honda NHL All-Star Game between the Atlantic Division and the Pacific Divison at Amalie Arena on January 28, 2018 in Tampa, Florida. (Photo by Dave Sandford/NHLI via Getty Images)

Like any good league, finding ways to bring value to both sponsors and the clubs keeps all parties happy and engaged.

For the National Hockey League, opening up four new in-ice spots starting during the 2018-2019 season was about giving clubs the opportunity to find new camera-visible signage and bringing what the league expects to be a “mid-seven-figure per position opportunity for the NHL during the playoffs.”

“It has always been an area that I am interested in developing. Not to only add more logos, but to deliver more value to our current and potential future sponsors,” said Keith Wachtel, the NHL’s Chief Revenue Officer. “If you look at our partnerships at the club level and what our league partners like when it comes to a league-wide event, in-ice positions are generally your largest partners at the club level that garner a significant amount of television impressions.”

What Wachtel sees as the most unique selling point for these particular positions is the opportunity sponsors will have to be a part of the biggest moments of the game as well as the highlights shared across the NHL’s digital platforms and social media channels.

“When we looked at it and considered other signage opportunities, which there are a lot of others that we have explored and that we continue to explore, we know that those four are extremely valuable. If you think about the way the game is played, most of the action that is comprised of goals, big hits, and saves are done in the corners as opposed to necessarily center ice. All of the various instant replays you will see in games but also across social media and highlight packages generally show a goal, a save, or a big hit.”

The league began testing the inventory this past pre-season in China and then followed up that test with placement at this year’s All-Star Game after what had been a three-year dialogue surrounding the initiative.

“We tested them in China during several pre-season games. Then we moved to the All-Star Game which really allowed us to take a look at them on an NHL rink in front of broadcasters, sponsors, clubs, league executives, and fans,” said Wachtel. “Ultimately, we came to the unanimous decision that we would go ahead and install those for the start of next season.”

Mercedes-Benz Arena on September 21, 2017 in Shanghai, China.

Relying on services like Nielsen Sports and GumGum Sports, the league was able to figure out the amount of time each position would be visible during a broadcast. For the teams that wanted to, many conducted their own analysis given that their broadcast angles might be slightly different than others.

Based on those valuations and what the market will bear is how Wachtel and his team see the inventory being sold, a process that the league will help with but will ultimately come down to how each team will decide to package them.

“How they will sell them is going to be unique to each club. They will most likely package them into broader sponsorship deals, because they are not necessarily interested in selling a brand that position without that brand already being a team partner.”

Unlike the four center ice placements, the league will take over control of the corner inventory come playoff time in order to sell a package that will span across every game of the Stanley Cup Playoffs through the Stanley Cup Final.

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“I look at this differently for us,” said Wachtel. “It doesn’t matter who is in the playoffs and that is the issue with the clubs, you don’t know who is going to make the playoffs so the clubs can’t monetize the playoffs the same way that the league could.”

Although we are still close to a month from a team raising Lord Stanley’s Cup above their head, Watchel and his team are already in the marketplace selling the inventory for next year’s playoffs. The exposure potential and exclusivity of the placements are features that Wachtel sees as a differentiator for the league when it comes to working with global brands.

The league tested the inventory at the All-Star Game this year. (Photo via NHL)

“Right now, we are in the marketplace talking about next year’s playoffs, selling anywhere from two to four marketers and those marketers will be at every game, every night, for every playoff game around the world. Because of that, our primary focus is to sell these to global marketers. We want a marketer that values not only the North American exposure, but also the exposure that we provide in all countries throughout Europe, Australia, and China. We have over 160 countries that broadcast NHL games, especially during the Stanley Cup Playoffs.”

Seeing that this is the first time the league has added new in-ice inventory since the original four at center ice, the question then becomes where the league goes from here and whether or not patches on sweaters may be next. A topic Wachtel was quick to dismiss given what he believes the impact the new corner inventory will have.

“If you think about it, right now teams in the NBA are selling jersey patches. It’s a great idea and they are making a lot of money from those patches. We aren’t ready to do that yet. We are still exploring it. We think our sweaters are different than that of other sports franchises. We also are looking for what we think would be a bigger impact.”

Adam is the Founder and CEO of Front Office Sports. A University of Miami Alum, Adam has worked for opendorse, the Fiesta Bowl, and the University of Miami Athletic Department. He can be reached at adam@frntofficesport.com.

Sponsorship

Celsius Makes Esports Inroads With Echo Fox Partnership

After making its name in the traditional sports sphere, Celsius is ready to take on the esports industry with its first sponsorship deal.

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Celsius Echo Fox

Photo Credit: Jeremey Freeman/Turner Sports via USA TODAY Sports

Celsius EVP of Marketing Matt Kahn never had imagined esports as a potential partner opportunity. Founded in 2004, the performance energy drink company has surged in the energy drinks space by positioning itself adjacent to the traditional fitness industry. But when the esports organization Echo Fox approached Celsius about a partnership, it only took a little research for Kahn to realize that a sponsorship made a lot sense.

“They professed to drink it while in training and tournaments,”  Kahn said. “I wasn’t shocked but found it super-interesting that these players are terrific athletes in their own right and need to focus for hours.”

According to Kahn, esports reached an audience of 335 million people globally in 2017 and is expected to grow to a market of more than 600 million by 2023. Meanwhile, brand investments — media rights, advertising and sponsorships — in esports are expected to reach nearly $900 million this year and jump to more than $1.5 billion by 2022. Those were exciting numbers for a brand that plays in a relatively new performance energy drink space, Kahn said. Competitors include brands like Bang and Monster Energy’s recent Reign product.

READ MORE: Blast Pro Series Debuts in U.S. with Fan Focused Esports Tournament

“It’s new for us,” Kahn said. “But having done the research into the industry and being a student of business and marketing and a sports lover, the category is exploding.”

Prior to the partnership with Echo Fox, Celsius stayed close to the core athletic segment it felt their product aligned with best. Celsius experienced a worldwide year-over-year revenue growth of 45 percent globally and 62 percent in the U.S., in part due to growth in sporting good channels. The brand went from a 25-store test with Dick’s Sporting Goods two years ago to more than 500 locations this year. Likewise, Celsius is positioned in 300 Academy Sports stores.

But recognizing the potential growth and market penetration of esports could be a boon for the company, Kahn said. He’s excited about Celsius’ entry into what he believes could be the “next billion-dollar industry.”

To that end, he considers Echo Fox to be an ideal first partner in the industry. Founded in 2015 by NBA champion Rick Fox, Echo Fox was recently named one of the most valuable esports organizations by Forbes and boasts teams in a variety of games ranging from League of Legends to Super Smash Bros. to Dragon Ball FighterZ.

READ MORE: AT&T’s Logo Deal With WNBA Represents Deeper Strategy With NBA

“Celsius continuously innovates and pushes the boundaries when it comes to keeping athletes healthy, and their support of a diverse group of athletic competition is something we admire,” Fox said in a statement. “Ensuring our players are competing at the highest level possible is a top priority for Echo Fox, and we’re confident that our partnership with Celsius will help us achieve that goal.”

As part of the partnership, Celsius now has the ability to use team and player images and likenesses as well as player testimonials. But Kahn also expects the product to be integrated organically into the team, an increasingly common tactic when targeting younger demographics. Some areas including placing the product nearby while players engage in cardio and hand-grip exercises, as well as competing in their respective games. “We’re going to have significant behind-the-scenes footage of these guys training and consuming the product,” he said. “Authenticity is important for me, to see who really loves the product.”

Esports are a natural habitat for energy drinks, with brands like Red Bull and Monster having already established deep ties in the industry. Yet it took time for Celsius to realize the market potential for itself. Now, with Echo Fox signed on as its first partner, it appears the brand is eager to make up for lost time.

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Sponsorship

NHL Turns to Corner Ice Placements to Grow On-Ice Ad Revenue

The NHL took over playoff team’s corner ice ad positions during the placement’s first year, as the league and its teams find new ways to add revenue.

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NHL Corner Ice

Photo Credit: Terrence Lee-USA TODAY Sports

The NHL has turned to a familiar source to add incremental revenue for this season’s Stanley Cup Playoffs. 

Prior to the 2018-2019 season, the league introduced corner ice sponsor placements this season for teams to sell, a marked change over its longstanding policy of only making center ice available for purchase. It was a smash hit: According to NHL Chief Business Officer Keith Wachtel, overall club revenue growth was in the eight figures, more than 25 percent higher than originally estimated.

The league was so pleased with the results that it decided to extend the rollout into the postseason for all 16 teams. This time, the league itself is handling the real estate firsthand, with Amazon Web Services, Enterprise, Ticketmaster and MGM Resorts serving as the designated sponsors.

READ MORE: NHL Turning to Hair to Tell Stories with Great Clips

Wachtel said the idea owes itself to having something of a good problem on its hands. The NHL is aided by a “very avid, passionate and affluent fan base,” with an approximate attendance-filled of 96 percent capacity. Short of building new arenas, however, there’s no more room to pack extra bodies into the stands.

“How can a club continue to generate year-over-year revenue growth when you’re selling all the tickets and have a finite amount of available sponsorship inventory?” Wachtel said of the league’s dilemma. “We felt what’s unique [is], unlike the other sports, we have the ability to bring partners onto the field of play as well as camera-visible dasher boards.”

The new positions in some ways are more valuable to potential sponsors than center ice, Wachtel said, as the corners are often where much of the on-ice action takes place. The exposure goes beyond the live games, too; most highlights on TV and social media are of goals and saves, which extend the life of those positions.

“The NHL playoffs are such a huge moment in time for fans everywhere and we’re fortunate to be a part of it,” said Greg Economou, Ticketmaster North America chief commercial officer and head of sports. “This provides us with another impactful touchpoint with fans to reinforce that Ticketmaster has the most tickets to see their favorite teams battle it out for the Stanley Cup live.”

Unsurprisingly, individual teams were pleased about the opportunity to both add revenue and, during the regular season, flexibility to choose where it came from. According to Jarrod Dillon, Tampa Bay Sports & Entertainment chief marketing and revenue officer, the Lightning opted for a strategy of quality over quantity. Tampa Bay quickly sold the four locations at Amalie Arena, opting to go with two partners — Heritage Insurance and Tampa General Hospital — for the four locations, rather than four individually, to “continue our brand value of doing more with fewer partners.”

“Naturally, we assumed national partners would be looking for more television visibility, but to our surprise, partners with main a local presence were also very excited about them,” Dillon continued. “The combination of national TV exposure, as well as local market TV exposure and then the in-arena local notoriety, seemed to resonate very well.”

Dillon credited Watchel and the league in opening up the new revenue stream and felt the league deserved to have the playoff corner ice positions with “great national partners.” Wachtel partly attributes the decision to logistics. Because the league was unsure of which teams would ultimately make the playoffs, it only made sense for the league to take over placements to guarantee ad partners they’d receive streamlined, guaranteed international exposure.

“We can extract that value, by and large, the goal for the league was to sell to global marketers that saw value across the world, not on a territory-by-territory basis,” Wachtel said.

READ MORE: Data Is Changing the Way the NHL Does Business

The MGM Resorts placement is part of a long-term sponsorship, while the AWS, Enterprise and Ticketmaster placements were sold on a one-year basis as incremental investments. The corner ice spaces are seen right now as a branding play, Wachtel said, and could be used in the future to help lure in larger league partners with their value.

“They’re four really great brands that see the value in the two months of hockey,” Wachtel said. “We went to find the right brands for the right value long term, which very well might be those. But we want to prove the opportunity before we go out there in the marketplace selling for more value.”

Irrespective of this program’s ultimate success, Wachtel says the NHL will continue to look for additional pathways to open up revenue streams. One could be a jersey patch sponsorship in the vein of what NBA teams have integrated over the past couple of seasons. Watchel didn’t put a timetable on the possibility, but the larger idea is in line with the league’s ambition to increase revenue and create a vibrant sponsor ecosystem without muddling the on-ice product. The endgame is still a work in progress. But the corner ice starting points have provided a strong foundation to build upon.

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AT&T’s Logo Deal With WNBA Represents Deeper Strategy With NBA

AT&T’s investment in the NBA includes the WNBA, NBA 2K League, G-League and USA Basketball, representing a piece of its broader entertainment sponsorships.

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WNBA ATT Sponsorship

All 12 WNBA teams will have an extra logo on their jersey this season.

During the WNBA Draft on Wednesday, jerseys with AT&T logos were revealed at Nike’s NYHQ as part of a multiyear partnership. Along with the jersey placement, AT&T will also gain integration throughout WNBA.com, the league’s app and social channels, and broadcast partners. The telecommunications company also will be the title sponsor of the WNBA All-Star game, starting this year in Las Vegas.

It’s the latest expansion of a deepening sponsorship plan between AT&T and the NBA, as well as the telecommunication company’s overall sponsorship plan.

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“The WNBA is deeply committed to empowering and inspiring women,” said Kerry Tatlock, NBA senior vice president of marketing partnerships. “AT&T’s groundbreaking commitment to our game, which is anchored on our shared values of diversity and inclusion, make it the perfect partner for the WNBA at this exciting time.”

It will be the first non-apparel logo to be on jerseys of all 12 teams. Also announced was a “refresh” of the WNBA brand, complete with a new WNBA logo. An ESPN report noted the logo will transition onto uniforms, courts and basketballs in 2020.

The WNBA deal is part of an overall NBA partnership that includes sponsorship of the NBA, WNBA, NBA 2K League, G-League and USA Basketball, said Shiz Suzuki, AT&T assistant vice president of sponsorships & experiential marketing. The AT&T partnership with the NBA started at this year’s NBA All-Star game, as the presenting sponsor of the slam dunk contest, All-Star practice and media day.

Suzuki said the deal makes the AT&T brand across the WNBA physically and digitally, which will hopefully help engagement for both brands and create new customers and fans alike.

“The WNBA represents a brand, league, players and fan base we want to connect with and grow with as we work with them to find ways to bring fans closer to the sport, whether through an on-site activation at major events like WNBA All-Star, or to fans at home and on the go using our social media and digital platforms to deliver premium content, behind-the-scenes access and stories from across the WNBA,” Suzuki said. “By doing so, we can connect AT&T customers to the WNBA to grow fan engagement and our relationships with current and new customers.”

Within the partnership between the WNBA and AT&T, the two organizations will create programming to support women in sports. It’s a further extension of AT&T’s work to support women, support diversity and foster inclusion. The company removed gender bias from its advertising last year, two years ahead of a stated goal by the Association of National Advertisers.

READ MORE: WNBA Star Sue Bird Makes Leap to NBA Front Office With Denver Nuggets

“Together, we can create ways for basketball fans and for AT&T customers to engage in the causes and communities important to the WNBA and to AT&T,” AT&T Chief Brand Officer Fiona Carter said. “Whether it’s women in sports, supporting small businesses like those owned by WNBA players, being a leading voice in LGBTQ rights, or giving back to communities in which we operate, we have much in common and many opportunities to empower these incredible athletes and their fans.”

The WNBA announcement came during a big week of sports activations for AT&T, which included the NBA 2K League’s The Tip  Off, Augusta National’s Women’s Amateur, the NCAA Final Four and The Master’s. Suzuki said the brand’s investments put fans at the heart of sports, music and other entertainment options — hoping to hit the diversity of the company’s consumer base.

“Our sponsorships strategy is about enabling growth for AT&T, by building more meaningful connections with current and with new customers,” Suzuki said. “To do that, we look to deliver moments that drive people’s love for sports, entertainment and their communities. Whether at an event, at home, or on the go, we want to bring fans closer to the moments that matter to them.

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